ECONOMICS
TECHNOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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suppliers lower their prices to increase demand.
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marginal benefits equal or exceed marginal costs.
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a budget is used for spending and saving decisions.
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command economies answer the three basic economic questions.
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Detailed explanation-1: -In economic terms, a rational decision is made when the marginal benefit of an action is greater than or equal to the marginal cost. As individuals, we rarely make all-or-nothing decisions.
Detailed explanation-2: -If the marginal benefit of an activity exceeds the marginal cost, the decision maker will gain by increasing the activity. If the marginal cost of an activity exceeds the marginal benefit, the decision maker will gain by reducing the activity.
Detailed explanation-3: -Explain the rational decisions occur when the marginal benefits of an action equal or exceed the marginal costs. Decision makers compare opportunity cost and benefits. Once the cost outweighs the benefits, no more units should be added.
Detailed explanation-4: -When the marginal benefit is greater than the marginal cost people will receive more benefits with per unit output as compared to change in per-unit cost.
Detailed explanation-5: -A rational decision-maker is trying to maximize utility. If the marginal benefit is more than marginal cost, then utility will increase. If they were equal utility wouldn’t change. If marginal cost was less than marginal cost then utility would decrease.